ACC Ltd likely to hike cement price after 3 months

Published: Tuesday, May 20, 2008, 14:35 [IST]

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New Delhi, May 20 (UNI) Country's largest cement manufacturer ACC Ltd today said it may increase the prices of cement after three months depending on the market forces and the government's decision regarding excise duty.

''Showing our concern to the rising inflation, we hold the prices for two-three months but after the period, the company may increase the prices depending on the market forces,'' ACC Ltd Managing Director Sumit Banerjee told reporters here.

However, he said the company may not increase the prices after three months if the government rolls back the hike in excise duty.

The government has put a ban on exports and a 12 per cent ad-valorem duty on cement selling above Rs 250 per 50 kg bag to tame inflation that further surged to 7.83 per cent for the week ended May 3 as compared to 7.61 per cent for the previous week.

Last year, the government made cement import duty free. Cement has a weight of 1.73 per cent in the wholesale price index (WPI).

Mr Banerjee said the increasing costs will further squeeze its margins in the second quarter to June.

''It is quite clear margins in Q2 will be under further pressure,'' he said, adding that the company is losing one per cent EBITDA margins every month on account of rising input costs and the present duty structure.